The future of the European Union’s development cooperation, Thessaloniki

EUROPEAN PARLIAMENT Anna Karamanou MEMBER OF THE EUROPEAN PARLIAMENT President of the Committee on Women’s Rights and Gender Equality

The topic of the conference is of particular importance, following the signing in Athens on April 16 of the Accession Treaty for 10 new countries to join the EU. The twenty-five member states are now called upon to adapt their policies in the field of development and to respond to the increasingly growing and changing trade, economic, and social demands of the developing world.

The work of the Community’s development cooperation policy is vast and multifaceted. The institutional framework exists both through the EU Treaties and regional agreements, such as the Cotonou Agreement for the ACP countries, the ALA Regulation for Asia and Latin America, and the PHARE, TACIS, and MEDA programs, to name a few of the most significant.

The EU is undoubtedly one of the main global actors in funding development (particularly humanitarian) aid and cooperation. Figures from 2002 show that Europe contributed $25 billion of the $54 billion total global development aid. These numbers demonstrate that Europe promotes universal values such as democracy, social justice, and sustainable development, and follows a policy of solidarity.

Development aid, of course, is not merely a matter of altruism. Strengthening developing countries is clearly also a long-term interest for Europe, as the marginalization of economies, the increase in poverty, and the degradation of the environment in many developing countries, along with the intensification of migration, armed conflicts, and epidemics, will have serious destabilizing effects on the EU and the well-being of its citizens.

Nevertheless, there is strong criticism regarding the ineffectiveness of the policies being followed and the grants provided to developing countries.

The criticisms mainly focus on the way external aid operates, as the implementation of programs involves a series of regulations, decisions, statements, and announcements that often lack a strategic goal. It becomes almost impossible, especially for the recipient countries, to navigate through this complex bureaucratic maze that prevails in the European Commission. In fact, some Member States have even gone so far as to propose the “re-nationalization” of external aid.

Another concern is that the EU’s development policies exude a strong dependence on the economic and political situation prevailing in the Member States. Today, the EU lacks a clear alternative direction regarding future prospects, and the policies it promotes are fragmented and limited.

If there were a different, more positive approach, it could contribute to the formulation of development policy, for which not only the rationalization of resource use is necessary, but also the securing of effective investments, which, at present, the Member States lack the political will to promote.

For these reasons, the need for a revision of European Community aid has become urgent.

The situation and prospects of developing countries in the 21st century: a bleak picture.

At the end of the 20th century, the standard of living in developing countries in general had noticeably improved, and poverty had been significantly addressed. According to the World Bank, life expectancy increased from 55 to 65 years, per capita income doubled, and mortality decreased by half. However, development in different regions of the world is extremely uneven (for example, the reduction in the number of poor people mainly concerns East Asia and particularly China).

On the other hand, since the end of the Cold War, there can be no talk of sustainable socio-economic development for the benefit of the entire population in many developing countries, specifically in large areas of Sub-Saharan Africa, which is the region where European development aid is primarily directed. Thus, the assessment of the thirty-year development policy is disappointing.

According to the World Bank, the recently adjusted estimates for poverty show moderate progress in reducing poverty over the past decade: “East Asia reaped impressive benefits before being hit by the crisis, but these were partly lost, while progress in other regions is minimal to non-existent. Furthermore, the vast majority of the poor report that they now live in worse conditions, have fewer economic opportunities, and experience greater insecurity compared to the past.”

The following are excerpts from the Commission’s statement, as well as from the World Bank’s Human Development reports for the years 1998, 1999, and 2000, which substantiate the extent of the problems:

– 86% of global consumption corresponds to 20% of the population. In 1960, the wealthiest 20% had an income 30 times greater than that of the poorest 20%, whereas by 1995 this ratio had reached 82.

– Of the 6 billion people in the world, 1.5 billion live on less than 1 US dollar per day. The majority of people living below the poverty line reside in South and East Asia (800 million); in Sub-Saharan Africa and South Asia, 40% of the population lives below the poverty line.

– The average life expectancy is 62 years in developing countries (51 years in the least developed countries) compared to 74 years in industrialized countries. The school attendance rate is 57% (36% in the LDCs), compared to 83% in industrialized countries.

– In Africa, AIDS kills 2 million people a year. Life expectancy is decreasing in many countries.

– 800 million people (1 in 5 in developing countries), of whom 200 million are children, suffer from chronic malnutrition.

– One third of the world’s population (about 2 billion people) has no access to adequate energy supply.

– The total population of the planet is expected to increase by 2.5 billion, or approximately 50%, during the period 1990-2020. About 90% of this increase will occur in developing countries.

– One of the most pressing problems that could lead to conflicts in the 21st century will be the water issue, as in 1997, one third of the world’s population lived in countries facing water scarcity. Deforestation in developing countries will continue, and it is expected that by 2010, carbon dioxide emissions in developing countries will exceed those of industrialized countries, including Eastern Europe.

The framework of development policy

For more effective development cooperation between the EU and developing countries, the coherence of development policy with other policies is of vital importance, particularly with trade, agricultural, and foreign relations policies.

Regarding external relations, as is evident, foreign policy (CFSP) and cooperation and development policy are interconnected. Unfortunately, in practice, the strategic objectives of the EU’s foreign policy seem to take precedence over Europe’s traditional commitment to fighting poverty in developing countries. The short-term functions of diplomacy often conflict with the long-term goals of development cooperation.

The intention for the gradual integration of development aid into foreign policy is also reflected in the intentions of the High Representative for Foreign Affairs, Mr. Solana, who argues that the Development Council should be integrated into the Council of General Affairs or the new European Council on Foreign Affairs. This would consequently mean changes both in the structures of the European Commission and in the Development Committee of the European Parliament, which would lead to a downgrade of transparency and control mechanisms. Thus, development policy would cease to be an independent policy and would be fully incorporated into the functions of European foreign policy, with all that this entails. Solana’s proposal reflects the deep division between the various bureaucratic services for external relations, both between the Council and the Commission, as well as within the Commission itself.

On its part, the Commission, in May 2002, presented its own rather bold proposal for a common foreign policy, where it explicitly emphasized the need for greater autonomy in foreign policy matters with an increase in the Commission’s competences.

The revision of external relations is a critical factor in the negotiations for the new Treaty of the Union. Unfortunately, the discussions during the Convention on the Future of Europe focused primarily on enlargement, foreign policy, and security policy, leaving the foreign policy of development aid on the margins of the discussions.

The EU’s trade policy has much deeper implications than development aid to developing countries and, for this reason, it must be harmonized with the development strategy. Europe studies the trade sector only in relation to the effort to integrate developing countries into the global economy, that is, the need for trade liberalization, taking into account the situation of developing countries. However, nowhere is it emphasized that developing countries will benefit from liberalization only if their export capacities to the EU are significantly strengthened.

It must be emphasized here the lack of coherence between the EU’s agricultural and development policies. Both the subsidies for EU exports and the barriers to market access for “sensitive” agricultural products significantly limit the trade opportunities of developing countries. In particular, all forms of export refund systems for agricultural products by the EU should be abandoned, a policy that has severe side effects on the agricultural sector of developing countries. Moreover, it is highly doubtful whether the regional partnership agreements envisaged by the Cotonou Agreement, which will define future trade relations, will truly have positive outcomes for developing countries, due to the vast inequality in the levels of economic development among the various involved developing countries.

The EU cannot, on the one hand, proclaim its solidarity with the poor by spending billions on development aid, and on the other hand, undermine any prospects for the agricultural sector of developing countries by protecting its own agricultural markets from products originating from these countries.

In the future, it is essential to ensure the regular, transparent, and standardized monitoring of coherence in relation to the objectives of development policy during the preparation of decision-making in relevant areas such as trade, agriculture, the environment, energy, research and technological development, fisheries, asylum, conflict prevention, health, competition, consumer protection, etc.

The coordination and complementarity of the EU’s and its member states’ development activities are crucial elements for the effectiveness of European development policy as a whole and the influence it exerts on the international stage.

The EU’s development policy must influence and, at the same time, be coordinated with the goals and policies decided by international development aid organizations, primarily the bodies and agencies of the UN system.

Until now, the EU’s development policy was funded through the European Development Fund and the EU budget, which makes it difficult to have a clear overall picture. In order to establish a transparent and coherent financing framework for the EU’s development aid, the European Development Fund should be integrated into the EU budget.

Objectives of development policy

During the United Nations Conference on Social Development (Copenhagen, 1995) and the supplementary conference held in June 2000, the fight against poverty was identified as the number one objective of development policy. Specific development goals were defined, accompanied by timeframes, such as, for example, halving the number of people living in extreme poverty, or ensuring the enrollment of all children in school by 2015. Unfortunately, according to the World Bank’s poverty report, it is projected that some of the stated priority goals (poverty reduction, universal education) will not be achieved. The failure of such ambitious poverty-reduction targets is attributed to limited financial resources, the continuous population increase, the persistent debt concerns for many developing countries, public health issues (especially AIDS and malaria), and natural disasters or wars (including civil wars).

In the effort to address the problems faced by developing countries and development policy (a point particularly emphasized in the major UN conferences of the 1990s), the main direction should be sustainable development, focusing on the social and human aspects of development, the sustainable use and management of resources, and the environment. Within this framework, the fight against and, ultimately, the eradication of poverty is a priority objective. In fact, the definition of poverty has been broadened, rightly, to include non-monetary components such as access to health services, education, natural resources, etc.

Recently, there has been broad consensus in Europe regarding the fundamental objectives of development policy. In particular, development policy has focused on the goal of eradicating poverty, within the broader framework of the Union’s external relations. Strategies for effectively eradicating poverty must place corresponding emphasis on strengthening social and health infrastructure and the productive capacities of the poor, such as access to land, technology, education, credit, etc. However, a wide public debate must be opened, involving civil society and the developing countries themselves, on the strategy, the role of the Community, the priorities (in terms of geography and sectors), and the resources needed to achieve the goals.

The political dialogue, which is also foreseen by the important Cotonou Agreement with the countries of Africa, the Caribbean, and the Pacific, can play a significant role in the implementation of the poverty reduction policy.

The reduction of poverty could be included as a fundamental horizontal condition in all development cooperation programs and activities. In this context, support for women, who, as traditional victims of legal, economic, and social discrimination, are among the most deprived categories of the population, must be a priority, with statistically significant impact on future evaluation.

Another priority area of action is support for developing countries in building institutional frameworks and good governance and management, which includes the control of public funds usage. This is a key element of the EU’s contribution to sustainable development and the organized fight against poverty, based on long-term planning.

Another priority area is health and education. The establishment of sectoral programs in the fields of education and health, particularly regarding the HIV/AIDS virus, malaria, and tuberculosis, is one of the most important areas of the EU’s contribution to the short-term and medium-term eradication of poverty and the improvement of living conditions in developing countries.

Conflict prevention is one of the pillars of the EU’s development policy, as war and armed conflicts can undo years of development efforts. Therefore, it is essential to allocate substantial financial and human resources for taking preventive action, leveraging the expertise of delegations in the affected countries, and, above all, ensuring the participation of women in negotiations.

Another important area, which the Commission remains silent on, is information and communication technologies. The globalized economy today relies on the use of new ICTs, a trend that will only intensify in the future. In London, the number of internet connections is greater than in all of Africa combined! How is it possible to achieve the integration of developing African countries into the global economy without their integration into the global information network? This is an issue that must certainly be addressed during discussions on the reform of development policy.

Application

In the future, the following must be ensured:

– The areas of responsibility within the Community’s bodies, and particularly within the Commission, must be clearly defined, in order to avoid confusion of responsibilities and overlaps (for example, the responsibility for the so-called “grey areas” between disaster aid and development cooperation must be urgently determined. Currently, these responsibilities fall more under ECHO, but the program lacks sufficient organizational resources in terms of personnel);

– Sufficient personnel must be allocated to fulfill the obligations undertaken in the field of development cooperation;

– Reforms must be undertaken in the area of management (more ex post controls, multi-annual planning, delegation of decision-making authority, assuming responsibilities on the ground, establishment of effectiveness indicators, etc.);

– Coordination with other donors, such as member states, must be institutionalized;

– Ensuring ownership and close cooperation with civil society organizations in the design and implementation of the EU’s development policy, as this is an essential prerequisite for a collaborative development cooperation free from paternalistic elements.

NGOs can function as the operational arm of the EU, ensuring the smooth implementation of programs in the countries receiving development aid.

Community development cooperation policy began almost simultaneously with the establishment of the European Communities. It has achieved much, but it certainly could have achieved more. Perhaps now, with the Union consisting of twenty-five members, we will be able to address the weaknesses and shortcomings of the past. The accumulated experience of the Member States and the Commission to date, along with the ongoing effort to reform EU external aid, we hope will mark the beginning of faster and more developmental actions. In this process, civil society organizations have been and will remain valuable allies and partners. Development cooperation needs their important work.

I am confident that the statements made today and tomorrow will provide useful points for reflection, in order to fully exploit the possibilities for cooperation, with the goal of optimizing the results of development aid programs and making the most of the available resources.

Anna Karamanou – Member of the European Parliament

www.karamanou.gr

eMail: [email protected]

Tel. 210 77 75 223

Fax: 210 77 57 771

Bibliography

1. 1. Reports on Human Development by the World Bank 1998, 1999, 2000
2. 2. Carlos Santiso “Reforming European Aid” CEPS 2002
3. 3. Vitaliano Gemelli – Report of the Development Committee on the development policy of the European Community, European Parliament Plenary Session, 14.02.2001
4. 4. Simon Maxwell-Paul Engel “European Development Cooperation to 2010” Working Paper, Overseas Development Institute 2003
5. 5. Communication from the European Commission (2000) 212 to the Council and the European Parliament on the development policy of the European Community
6. 6. “Improving European Development Cooperation” Policy Paper, ActionAid Alliance 2003